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The HOA (Homeowners' Association) we are dealing with charged an NSF (Non Sufficient Fund) Fee and said they weren't able to cash the money order and since this is regarding a payment due in September, they have since shredded the money order pertaining to that time period (documents after 30 days aren't kept apparently).

The money order was actually an older money order (over a year ago) but we never used it and the issuer said that money orders don't expire and act like real money so it can be used anytime so that is why we used it.

Now we are told that its gone and no longer in the recipient's possession. What do we do about the money we used to make the money order?

Does the NSF Fee make sense? Money orders are a guaranteed form of payment, it seems somewhat negligent to charge a NSF fee willy-nilly. If anything it should be noted as a late fee or something else, but still they should have contacted us to clear up any issues dealing with the money order as it is not the same as a personal check.

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    I assume based on your other questions that this is in the USA but it would be useful to tag that. Assuming this is in the USA, did you get the money order from the post office? Or somewhere else? If this in the USA and you got the money order from the post office, there is a procedure to usps.com/shop/money-orders.htm replace lost, stolen, or damaged money orders.
    – Justin Cave
    Commented Dec 15, 2021 at 1:35
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    Did they contact you before they destroyed the money order?
    – mhoran_psprep
    Commented Dec 15, 2021 at 3:24
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    @LeanMan sounds fishy to me, they should have provided you with evidence that it was bounced, otherwise how can you know they didn't deposit it and just lied to you? Wouldn't put anything past US HOAs....
    – littleadv
    Commented Dec 15, 2021 at 7:09
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    yea I totally agree. We are thinking the same thing. Like we paid it (in our view) on time and now we are being charged a fee we cannot determine if its appropriate without digging into the WU's rules more. Being that they allow a MO to be 1-3 years old and still cashable, we may very well be in the clear. Not to mention the issuer said there was no time limit on the MO, though as @Justin Cave has noted, WU may have a time limit after all. The HOA just made a bad situation worse and on top of that makes us feel really bad missing a payment. Ofc we would have resolved it immediately att.
    – LeanMan
    Commented Dec 15, 2021 at 7:20
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    @brichins To me, the bigger life lesson is... never join an HOA. :-)
    – Brad
    Commented Dec 17, 2021 at 5:19

2 Answers 2

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The Western Union site has a page on the expiration of money orders. Depending on the state, a non-refundable service charge will be deducted from the money order amount after 1-3 years. But the site also states that a money order that has had such a fee deducted will be returned unpaid if it is presented for payment.

I'd guess that you live in a state where the money order you sent the HOA had a fee deducted because of its age. You sent the money order to the HOA. They presented it for payment but Western Union returned it unpaid. As a result, the NSF fee makes sense. From the HOA's perspective, this was no different than a personal check that bounced.

As @RiverNet indicates in his answer, you can request a refund of the money order (minus, of course, the service charge I'm assuming was deducted before you sent it to the HOA).

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    Genius! Thank you for that additional piece of very important information. I will definitely speak to Western Union about that. Unfortunately, with the the MO being shredded I cannot look at the back to look at the details of this rule but I will see if the original issuer can explain the rules in my state. Thank you so much for your answer!
    – LeanMan
    Commented Dec 15, 2021 at 7:13
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    So I spoke with WU and they said that most states its 1 year. States like California or territories like Puerto Rico its 3 years. The way the rule works is that $1.50 is deducted each month but realized on the first day of 13 month or in the case of 3 year rules first day of the 37th month. So the deduction is accrued but not realized until that date. Which makes sense for 1+ year old MO.
    – LeanMan
    Commented Dec 16, 2021 at 7:11
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Western Union does have a form you can complete for a refund of a money order:

Link to PDF form for refund

As it says on the Western Union site, depending on the state the money order was purchased in, you could be assessed a fee (deducted from the principal amount) if the money order is not used within 1 to 3 years of purchase.

Regardless, you should still be able to file a "lost money order" claim with them and get the money back.

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